LAW Collar Strategy
LAW (CS Disco, Inc.), in the Technology sector, (Software - Application industry), listed on NYSE.
CS Disco, Inc., a legal technology company, provides cloud-native and artificial intelligence-powered legal solutions for ediscovery, legal document review, and case management for enterprises, law firms, legal services providers, and governments. The company offers DISCO Ediscovery, a solution that automates ediscovery process and saves legal departments from manual tasks associated with collecting, processing, enriching, searching, reviewing, analyzing, producing, and using enterprise data that is at issue in legal matters. It also provides DISCO Review, an AI-powered document review solution, which consistently delivers legal document reviews; and DISCO Case Builder, a solution that allows legal professionals to collaborate with teams to build a compelling case by offering a single place to search, organize, and review witness testimony and other legal data. The company's tools are used in various legal matters comprising litigation, investigation, compliance, and diligence. CS Disco, Inc. was founded in 2012 and is headquartered in Austin, Texas.
LAW (CS Disco, Inc.) trades in the Technology sector, specifically Software - Application, with a market capitalization of approximately $225.8M, a beta of 1.96 versus the broader market, a 52-week range of 2.45-9.11, average daily share volume of 440K, a public-listing history dating back to 2021, approximately 561 full-time employees. These structural characteristics shape how LAW stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.96 indicates LAW has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position.
What is a collar on LAW?
A collar pairs long stock with a protective out-of-the-money put financed by a short out-of-the-money call, capping both tails of the position around the current spot.
Current LAW snapshot
As of May 12, 2026, spot at $3.74, ATM IV 92.40%, IV rank 25.37%, expected move 26.49%. The collar on LAW below is built from the same end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 37-day expiry.
Why this collar structure on LAW specifically: IV regime affects collar pricing on both sides; compressed LAW IV at 92.40% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 26.49% (roughly $0.99 on the underlying). The 37-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated LAW expiries trade a higher absolute premium for lower per-day decay. Position sizing on LAW should anchor to the underlying notional of $3.74 per share and to the trader's directional view on LAW stock.
LAW collar setup
The LAW collar below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With LAW near $3.74, the first option leg uses a $3.93 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed LAW chain at a 37-day expiry; the cross-strike IV skew is reflected directly in the per-leg values rather than approximated. Quantity sizing assumes one contract per option leg (or 100 LAW shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $3.74 | long |
| Sell 1 | Call | $3.93 | N/A |
| Buy 1 | Put | $3.55 | N/A |
LAW collar risk and reward
- Net Premium / Debit
- N/A
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- Unbounded
- Breakeven(s)
- None on modeled curve
- Risk / Reward Ratio
- N/A
Max profit roughly equals short-call strike minus cost basis plus net premium; max loss roughly equals cost basis minus long-put strike minus net premium. Breakeven shifts by the net premium.
LAW collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on LAW. Each row is one sampled price point from the computed payoff curve; the full curve uses 200 price points internally before being summarized into 10 rows here.
When traders use collar on LAW
Collars on LAW hedge an existing long LAW stock position; the long put sets a floor while the short call finances it, often run as a near-zero-cost hedge during expected volatility windows.
LAW thesis for this collar
The market-implied 1-standard-deviation range for LAW extends from approximately $2.75 on the downside to $4.73 on the upside. A LAW collar hedges an existing long LAW position with a protective put while financing the put cost via a short call; when the premiums roughly offset, the collar acts as a near-zero-cost insurance band around the current spot. Current LAW IV rank near 25.37% sits in the lower third of its 1-year distribution, where IV often re-expands toward the mean; this favors premium-buying structures and disadvantages premium-selling structures on LAW at 92.40%. As a Technology name, LAW options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to LAW-specific events.
LAW collar positions are structurally neutral (protective); the modeled P&L assumes European-style exercise at expiration and ignores early assignment, transaction costs, dividends paid before expiry on the stock leg (when present), and the bid-ask spread on the listed chain. LAW positions also carry Technology sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move LAW alongside the broader basket even when LAW-specific fundamentals are unchanged. Always rebuild the position from current LAW chain quotes before placing a trade.
Frequently asked questions
- What is a collar on LAW?
- A collar on LAW is the collar strategy applied to LAW (stock). The strategy is structurally neutral (protective): A collar pairs long stock with a protective out-of-the-money put financed by a short out-of-the-money call, capping both tails of the position around the current spot. With LAW stock trading near $3.74, the strikes shown on this page are snapped to the nearest listed LAW chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are LAW collar max profit and max loss calculated?
- Max profit roughly equals short-call strike minus cost basis plus net premium; max loss roughly equals cost basis minus long-put strike minus net premium. Breakeven shifts by the net premium. For the LAW collar priced from the end-of-day chain at a 30-day expiry (ATM IV 92.40%), the computed maximum profit is unbounded per contract and the computed maximum loss is unbounded per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a LAW collar?
- The breakeven for the LAW collar priced on this page is no defined breakeven on the modeled curve at expiration, derived from end-of-day chain premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The current LAW market-implied 1-standard-deviation expected move is approximately 26.49%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on LAW?
- Collars on LAW hedge an existing long LAW stock position; the long put sets a floor while the short call finances it, often run as a near-zero-cost hedge during expected volatility windows.
- How does current LAW implied volatility affect this collar?
- LAW ATM IV is at 92.40% with IV rank near 25.37%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.